Yes but they can get whatever number they announce through multiple means without having to be specific. For instance this could also be 360's sitting in the warehouse with a promise of being sold...If you think that is illegal Sony used to do that all the time to inflate their numbers by a few million and it is perfectly legal. In factg PR statements are given a HUGE amount of flexibility in how they can present "facts" because essentially they are like one big ad. They can not represent false facts but they can be real "facts" dressed up to look much better.

We used to go through this debate all the time whenever Sony released a PR. One other trick Sony used to like to do is announce the number of PAL systems sold worldwide through SCEE. Its a business and first thing a business does is promote itself.

Also for any type of statistic like this allow around 5% margin of error up or down unless you know the sampling methods or pool size. 2 million isn't that much to be in transit or stock piled there si more to europe than the UK and it is a large land mass with many many stores and retailers to be stockpiled.

soo? sony said some couple of weeks ago it sold 17mil ps3's soo ps3 is also undertracked

It may be. I have not done the math. This thread is not about 360 vs PS3. It is about making sure that the numbers are accurate. I did the math for the 360 because we have more detailed official information for it than for the PS3. 

Not really true. Any business performance numbers the provide in public statements must match their books. When they say that they "sold" a number of systems- it correlate to order for the system in their books. Otherwise they will be in hot water.

Whether the ordered systems are in warehouses, trucks, ships or retail shelves does not matter. As long as they are ordered and on the books they are all "sold" for the purpose of business performance.

But you are right in a narrow sense - the company can cherry pick to publish the facts that helps its image. But whatever they publish must be true and match their books, or they are breaking the law.

@amirnetz:

I am not outright going to say you're wrong, but it does seem like you're taking some things too literally.

I also agree with those who said that a build up of stock before Christmas is not only normal but healthy.

I am not picking on Sony here it is just that at the start of this gen theywere the worst aggravators of the type thing we are discussing here.

So amirnetz you mean to tell me that when Sony announced that the famous Killzone 2 trailer was actual in game realtime footage and not a target render that they were breaking the law?

Remember when Sony said the PS3 was sold out in a PR statement and the internet flooded with pictures of it in complete stock?
(it was likely sold out at one or two retailers)

Or win they made a PR statement about the PS3 being cheaper than the 360?
(after they added the HD-DVD player, 20 GB HDD and wireless controller and XBOX live gold account to the cost of a core system)

This is what companies do they spin during the PR announcements. This isn't the same type of claim and much more grouunded in reality but you can see how a good PR person can stretch the tiniest grain of a fact and push into an exageration.

BTW if we are undertracking here how about NPD. The fact is there is a bigger more established I will not say more accurate but no offense Ioi (I love this site) more reliable data source for this sort of thing GFK and chart track. Have you looked at those.

It is a fact that PR statements are not held to the same standards as aquarterly report and even if it were than it is not enforced and therefor Null.
As you can see from the above the truth is irrelevant and if the actual number were 4.6 they CAN round it up 5 million if they wanted tobecasue 5 is closer to 4.6 and they are releasing a whole number. It could also be an approximation based on a cursory glance of reprots as well the truth is you I don't know. But to take a PR statement as gold and instead of adding it to the bigger picture makes you look narrow.

BTW forgive the typos I have to write these posts fast at work.

Let me tackle this one-by-one...

First, the "breaking the law" part has only to do with business performance statements (sales, profits, etc). The law does not deal with general PR statements that are not about business performance. That said, lying in a public statement on anything can get you liable in a civil case (for example, bragging about a feature that does not exist could get you into Class Action suit).

Please understand, lying is just bad business in general and the market punish you severely you can tell the truth 100 times and lie only once and the market will remember the one lie. This is why businesses try as hard as they can not to do it. The KZ2 example is a great one. It’s been 4 years and we still all remember it. Whoever did the mistake for saying it was a live game footage (likely an innocent mistake being fed misinformation from Gorilla, or maybe even intentional lie) is probably wishing he could have a "redo" on this. Similarly, the comments by Trenton about the unavailability of the PS3 in early 2007 were treated just as severely by the market (as can see - we all still remember them). I am pretty sure that Trenton thought it is true when he said it as he would not be so stupid knowingly tell a lie that can be refuted in minutes. Again, neither of those are about business performance so there is no law breaking. But both of these were cases where the actual facts were not verified properly and the consequences to the company image and credibility were severe.

BTW, the "PS3  being cheaper than the 360" from Sony was not lying. They were trying to show that the value of the PS3 is better than a similarly configured 360.  This was absolutely fair game and a common practice to show that your deal is better.

Back to business performance statements. You are not allowed to round the numbers when you are reporting business performance. This is a big no-no and can land you with criminal charges. This is serious business and professionals just don't mess around with this. When it comes to business performance, if the numbers don't look good then you have the option of keeping your mouth shut and say nothing. If you do go with a public statement then it is on real, verified numbers.

I feel that some members here have this mental image of the PR guys regularly sitting in a smoke filled room plotting the next set of lies to tell. Some of you think that companies feel they have freedom with the truth. It is so easy to demonize the “greedy companies who’ll stop at nothing to get what they want”. For those of you I beg to grow up a little. This is just not how it works.

If you look back at every case where a company was caught with an inaccurate statement and realize the major negative consequences of each one of these cases, you’ll understand why companies try so hard to be accurate and why every statement is vetted so carefully. It is just very bad business to be caught with a lie or even inaccuracy. The market just crucifies you. These “greedy companies” knows it and knows that to have a better business they must not be caught with a lie. This is just the ABC of PR and enterprise business in general.

And then there is the other level – lying about your business performance. That could really land you in jail.

"Again, neither of those are about business performance"

Tretton was obviously trying to mislead people into believing the PS3 was selling out in virtually all stores, when it clearly wasn't the case. How is that not about business performance?? Any investor who believed it would have been misled into thinking that the PS3 was a blockbuster success.

"You are not allowed to round the numbers"

So if, say, a console shipped 4.99 million units they can't say it shipped around 5 million? I highly doubt such a rule is ever followed (if it exists).

NJ5 - I actually think it is important that people realize that the numbers pulished by the companies are real accuate numbers. That we cannot just decide that they are "lies" or "roundups" or "inaccurate" just because it does not fit the numbers we were tracking. I hope that at least a few people on this site will try to treat the official data with the right attitude and understand that in this world companies really can't take liberties with the truth.

The question of the stock was more around the timing. Having 2M stock build in early November does not make sense business wise. 2M in December is fine. There is a problem with the math and I pointed it out.

No. First - Tretton was not reporting numbers - therefore these are not business performance statements. Just like a PR statement of "Our product is flying of the shelves" is not a business performance statement.

Second, Tretton was actually telling the truth about the shortages. See link below. From his perspective, there was a severe shortage of PS3 is the USA and he had to airlift them from Japan.

http://www.australianit.news.com.au/story/0,24897,21031910-15306,00.html

Lastly - no you are not allowed to round up the numbers. You can say "we sold almost 5M units", or "by next week we'll have 5M units sold" or wait a couple of days to until the sales gets to 5M to make the statement true. You just cannot make up your own numbers.